AI Investment Opportunities Beyond Big Tech

So-called AI trading has been a key driver for the markets, particularly among the biggest names in tech. But overvaluation concerns are causing some investors to look elsewhere for opportunities. Justin Flowerday, managing director and head of public equities at TD Asset Management, tells Greg Bonnell that there are other ways to play the long AI game beyond big tech.

Transcription

Greg Bonnell – Concerns about overvaluation in the so-called AI trade are causing some investors to look elsewhere for opportunities. Well, my next guest says there are other ways to play the AI ​​long game if you know where to look. We’re joined by Justin Flowerday, managing director and head of public equities at TD Asset Management. Justin, welcome back.

Justin Flowerday – Great to be here, Greg.

Greg Bonnell – Okay, so obviously the AI ​​game up until this point has been heavily focused on those people making the chips that power it all. It’s a long-term growth story. Let’s start with productivity. I mean, if this is to be believed, then it’s in the long run.

Justin Flowerday – 100% And I think there’s a story to be told where the productivity gains will come back for the economy. The problem is, it won’t happen right away. And we’ve seen this phenomenon play out over time, where you get this lag between a breakthrough technology and the productivity gains that come from it to society and industry.

And people refer to it as the productivity paradox or the J-curve of productivity. And there is the gap. Productivity may actually go down a bit before it goes up. We saw it with the steam engine 300 years ago, right? Economists would say it took 100 years for productivity gains to result from this.

Electricity during the industrial revolution. Managers and companies had to redesign